Sketchy Startup Promises Facebook Stock To Investors
The founder of the company, Neil Chandran, spends a great deal of time talking up Facebook’s value, saying that an IPO is “imminent” and noting that Google shot from $85 to $500 after their IPO. He also says that Facebook should hit $120, no problem.
This is a general solicitation of securities by an underwriter under the Securities Act. But it’s being done without disclosure of information required by the Act – namely, a prospectus. This is exactly the kind of thing that the SEC salivates over as they sharpen their legal claws.
“Neil Chandran, Freevi Corporation and Freevi Capital Ltd. are hereby ordered to desist and refrain from the further offer or sale in the State of California of securities…unless and until qualification has been made under the law or unless exempt.” PDF is here.